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Employers Must Bargain Over Discretionary Discipline Before Agreement on First Contract

By Nelson Cary

By Nelson Cary and James Patrick

In Alan Ritchey, Inc., the NLRB recently adopted a new rule that will have an immediate impact on any employer attempting to negotiate an initial contract with a newly organized bargaining unit. Specifically, after a union becomes the employees’ bargaining representative, but before the parties have agreed to their first contract, employers must bargain with the union prior to imposing discretionary discipline. 

The NLRB reasoned that employers cannot continue to act unilaterally with respect to terms and conditions of employment once employees choose to be represented. Further, discretionary discipline, like other terms and conditions of employment, is a mandatory subject of bargaining. An employer must, therefore, provide the union with notice and an opportunity to bargain before the employer can exercise its discretion to impose discipline on individual employees. The employer must also provide the union with relevant information, if a timely request is made, about the discretionary aspects of the proposed disciplinary action.

 

Although it announced this new rule, the NLRB immediately qualified it in several respects:

  • First, employers are only required to bargain over the discretionary aspects of their decision. Non-discretionary aspects of the disciplinary decision, as well as those that are consistent with past practice, need not be a subject of bargaining.
  • Second, the duty to provide the union with notice and an opportunity to bargain prior to imposing discipline is limited to certain types of discipline that have an immediate impact on the employees’ terms and conditions of employment, like suspensions, demotions, and discharges. In situations involving lesser disciplinary action, an employer may defer bargaining to after the lesser sanctions are imposed. But the NLRB limited even this exception, noting that the exception applies only so long as that lesser discipline does not “automatically result” in additional discipline, under the employer’s progressive disciplinary system, that “would itself require” bargaining.
  • Third, the bargaining obligation may be deferred until after a disciplinary action is taken where exigent circumstances exist. In such a situation, employers may act immediately as long as afterwords they promptly “provide[] the union with notice and an opportunity to bargain about the disciplinary decision and its effects.” Not surprisingly, the NLRB narrowly limited the concept of “exigent circumstances” to situations “where an employer has a reasonable, good-faith belief that an employee’s continued presence on the job presents a serious, imminent danger to the employer’s business or personnel.”
  • Finally, where the employer is required to bargain with the union prior to imposing discipline, the employer is not required to bargain to agreement or impasse prior to implementing the discipline as long as: (1) it does so afterward; and (2) it exercises its discretion within existing standards. Further, in any situation where an employer properly implements discipline without reaching agreement or impasse, “the employer must bargain with the union to agreement or impasse after imposing discipline.”

For labor professionals, the NLRB’s decision is significant for a number of reasons:

  • It threatens to bog down negotiations over a comprehensive agreement with negotiations over a series of discrete disciplinary actions and events.
  • It creates another potential area of legal exposure for a newly unionized employer in connection with disciplinary actions.
  • Given the NLRB’s suggestion that an employer and union could negotiate an “interim grievance process” that would address the employer’s obligation to bargain over disciplinary action, the decision could lead to piecemeal discussions over significant issues during negotiations.
  • It tilts the playing field during negotiations in the union’s favor, by imposing a substantial limitation on a core management right – the control and direction of employees – that management must bargain to retain.

The NLRB’s decision will be applied prospectively. Member Hayes (R) did not participate.

Tags: Alan Ritchey

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